Fuel Prices in Ukraine Stop Rising After Oil Decline
Last week brought a sharp drop in global oil prices the biggest since 2022. For the global market, this was a noticeable event that immediately triggered expectations: if oil is falling this fast, fuel prices at gas stations should follow. But for the Ukrainian market, the situation looks more restrained. Here, it is not about rapid price cuts, but rather about a halt in previous growth and a transition into a phase of close monitoring of external developments.
“Time for Action” analyzed the situation, and it shows that the Ukrainian fuel market is currently in a fragile balance. On one hand, declining oil prices created room for adjustment. On the other, the internal structure of the market, currency factors, weak demand, and the risk of renewed escalation in the Middle East prevent any confident expectation of a sustained downward trend. The global oil market indeed showed a sharp reversal during the past week. The main driver was expectations of negotiations between the United States and Iran aimed at achieving a final ceasefire. Against this backdrop, the market began pricing in a de-escalation scenario, which implies lower risks of supply disruptions. Additional signals came from the situation in the Strait of Hormuz, where vessel traffic remained low, and most ships passing through were linked to Iran. For the oil market, this meant that tensions remained, but no longer pointed to an inevitable large-scale escalation.
As of the evening of April 10, May futures for Brent crude had fallen by 7.78% to $95.2 per barrel. U.S. WTI declined to $96.57 per barrel. On a weekly basis, Brent dropped by 12.7% and WTI by 13.4%. This is a sharp correction. However, the Ukrainian market’s reaction once again confirmed that oil prices and retail fuel prices do not move in perfect sync or at the same speed. The reason is that Ukraine’s fuel market responds to multiple factors at once. Wholesale procurement, import volumes, supply density, currency fluctuations, and domestic demand all play a role. That is why even a significant drop in oil prices does not automatically translate into an equally sharp decline at the pump.
In the wholesale segment, diesel prices did begin to decline toward the end of last week. As of April 10, compared to April 3, the average wholesale diesel price fell by 1.67 UAH per liter to 88.07 UAH per liter. Compared to April 8, the decrease reached 2.36 UAH per liter. At the same time, the number of offers on the diesel market increased by nearly 10%. This is an important signal: the market is well supplied with fuel, which reduces upward pressure on prices. On external markets, quotations for gasoil the primary feedstock for diesel production also declined. This confirms that diesel prices have a foundation for stabilizing and gradually moving lower. However, this trend appears much more slowly at retail stations. As of April 10, the average retail diesel price was still higher by 2.72 UAH per liter compared to April 3. Compared to April 8, the decrease was only 5 kopecks. This highlights the key feature of the current moment: wholesale prices are already moving downward, while retail prices are only stopping their rise.
A similar pattern is observed in gasoline. On the wholesale market, A-95 gasoline fell by 1.16 UAH per liter compared to April 3, reaching 67.82 UAH per liter. Compared to April 8, the decrease was 64 kopecks. At retail stations, the change is far more modest. The average price of A-95 declined by 48 kopecks over the week and by only 9 kopecks compared to April 8. This indicates that operators have begun adjusting prices, but are doing so cautiously. According to market participants, fuel prices at gas stations have now reached parity with oil quotations. This means that retail prices have already incorporated previous external movements and currently lack a strong margin for either a sharp decline or immediate renewed growth. Therefore, the most likely short-term scenario is a pause rather than a clear trend.
However, this pause does not mean stability in a broader sense. It depends directly on developments around Iran, the United States, and the Middle East in general. If escalation resumes, new strikes occur, or negotiations collapse, the oil market can quickly reverse its decline. In such a case, fuel prices in Ukraine would also rise. This is why the current situation looks more like a temporary break between waves than the beginning of a lasting relief for consumers. The currency factor adds another layer to this picture. According to the National Bank of Ukraine, the U.S. dollar remained stable at 43.50 UAH, while the euro rose by 0.53 UAH to 50.80 UAH. On a weekly basis, the dollar slightly decreased, while the euro increased. This is critical for the fuel market, as import contracts are denominated in dollars, while excise taxes are paid in euros. This means that even with lower oil prices, part of the potential benefit is offset by currency movements. As a result, the decline in global oil prices does not fully translate into lower prices for consumers.
Import dynamics also play a role. In the first half of the week, gasoline imports slightly increased, but overall remained at low levels. Over the first eight days of the month, average daily gasoline imports were 64.7% lower compared to March. This figure shows that the market is not operating with a large surplus of gasoline, but it is also not facing acute shortages. In such conditions, any external shift upward or downward can quickly alter the balance. The situation in the LPG segment is even more revealing. Here, the decline in wholesale prices accelerated sharply at the end of last week. The average price of propane-butane with delivery fell by 2,503 UAH per ton to 82,568 UAH per ton. For pickup, the price dropped by 1,395 UAH per ton to 81,223 UAH per ton. In this segment, not only global factors matter, but also a strong domestic driver oversupply combined with weak demand.
A significant influx of supply, lower consumption, and overall market saturation forced operators to reduce prices more aggressively than in gasoline or diesel. This is why LPG reacts more sharply to market changes. At retail stations, however, the situation is less straightforward. As of April 10, LPG prices were still 1.09 UAH per liter higher compared to April 3, reaching 48.88 UAH per liter. Compared to April 8, LPG prices declined by only 8 kopecks. This again confirms the broader trend: retail markets are stopping price growth but are not yet shifting into a strong downward phase. Market participants note that in the case of LPG, the decline in wholesale prices is not driven solely by global quotations. Changes in fuel density and oversupply due to weak consumption also play a significant role. At retail level, operators have already raised prices to maintain margins and cover operational costs. Therefore, the most likely scenario for LPG in the near term is a halt in price growth, rather than a sharp decline at the pump.
All of this leads to a restrained but clear conclusion. The Ukrainian fuel market is not entering a phase of significant price decline. It is entering a phase of cautious balance, where lower oil prices, oversupply in certain segments, and weak demand prevent further growth, but do not create conditions for rapid and deep reductions. For Ukrainian drivers, this means the following: in the near term, stabilization is more likely than noticeable relief. Gasoline and diesel have already approached their current market balance. LPG may decline slightly more, but even there, the limit is close. What happens next will depend less on the domestic market and more on geopolitics. If tensions between the United States and Iran do not escalate and de-escalation becomes reality, oil prices may gradually move lower. In that case, fuel prices in Ukraine would also have room for a gradual decline. But if negotiations stall or the conflict intensifies again, the current pause will prove to be short-lived. The key point is clear: the fuel market in Ukraine has not entered a phase of decline, it has only stopped rising as rapidly. And as long as external risks remain high, any stability in this market will remain conditional.
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